Lessons from Syria 1: Refugee crisis or refugee opportunity

Around 4 million have left Syria, of whole 400,000 are among 1-1.5 million refugees in Europe.

Evidence suggests that working age migrants benefit their host countries, but it is unclear whether it applies to the current situation.

The migrants cannot be expelled from Europe, so policies must maximise the benefit to both the migrants and the host countries.

Aleppo in 2006 (Chris Hill [CC / Flickr])

On 14th June this year, a man called Ahmed (not his real name) left what remained of his home city of Aleppo. Nearly three years earlier, the Syrian army and their Hezbollah allies had moved into the city from one side while the rebel coalition calling itself the Free Syrian Army moved in from the other. Since then, the fighting had been unrelenting. Government helicopters bombed the rebel lines. The rebels improvised artillery by packing gas canisters with explosives and lobbing them at the government. Neither side showed any concern for people like Ahmed, who had never asked either side to turn their homes into a battlefield.

Neither account describes why he decided to take the next step, but we can speculate. Most Syrians in Turkey are eking out what living they can in a country where they do not speak the language and had a high unemployment rate of over 9% before two million Syrians arrived. The nearest thing the refugees have to a social safety net is a network of refugee camps, where they may be given a tent or converted container to live in and meagre meals. The camps offer some security from starvation, but at the cost of any chance to earn a wage. Without money, people in the camps are likely to be stuck in them.

Ahmed didn’t say whether he and his family were in a camp or not, but it’s not hard to see why he wanted something better than the options he was faced with in Turkey. What reasonable person wouldn’t?

Aleppo in 2012 (abdullatif anis [CC / Flickr])

A third option was suggested by the stories drifting in of a better life in Germany. The problem was getting there. The first step was the most dangerous and the most expensive, so Ahmed left his family and made the journey alone. In a previous age, a man who left his family in an unfamiliar country in search of work overseas couldn’t be sure he would ever see them again. Ahmed had no such qualms. He would keep in touch as long as he kept his phone charged and if he succeeded in finding work, money transfer services like Western Union make it easy for him to send them money.

The northwestward trek

Ahmed paid a smuggler $1125 for a bus to the coast, a night of dodging the police through a forest and a seat on a rubber boat bound for the Greek island of Lesbos. Approaching Lesbos by night in an overcrowded and flimsy boat is a task for a skilled and experienced sailor. Ahmed discovered the man he had trusted his life to wasn’t equal to the task when a rock ripped the rubber hull open. He spent 45 minutes expecting to join the ranks of faceless corpses washed up on Europe’s Mediterranean shores, but luck was with him. He was rescued.

Ahmed was alive and in the European Union. The bad news was that he was on a small island belonging to a country undergoing its own economic crisis. Worse, he was part of the largest influx of refugees into the European Union for more than 20 years. Ahmed and his fellow Syrians were part of a large and unplanned migration across the Mediterranean into Southern Europe, driven mainly by conflicts in Afghanistan, South Sudan, Libya and Somalia.

Nobody objected to his taking a ferry to Athens, where he found a room in a comfortable hotel. He found the Athenians friendly and sympathetic, but found no way to supplement his dwindling finances. He set out for Germany.

Following a phone across Europe

The GPS on his smartphone guided him across Macedonia on foot. In Serbia, he was robbed by a taxi driver. In Hungary, he was arrested and beaten by the police. On 4th August, 11 days after leaving Turkey, he trudged into a small village in Austria and boarded a train for Munich. While his ticket was being checked at the border crossing, he heard the strains of the German national anthem. ‘We were’, he says, ‘very, very, very happy’. He is now in Hamburg, where he is in regular touch with his family who are still in Turkey.

Ahmed is one of millions of people whose lives have been torn apart by the Syrian civil war. More than half of the population of 18 million have been driven from their homes. The United Nations High Commission for Refugees estimates that around 6.5 million of them are ‘internally displaced’ within Syria. Another 4 million have left Syria altogether. Given the balance of the media coverage, it would be easy to get the impression that all 4 million and then some are on Ahmed’s trek across Europe. In fact, only about 10% of the refugees who have left Syria are in Europe. The large majority are in Turkey, Lebanon and Jordan.

To put the numbers into context, it’s as though everyone in Los Angeles and Chicago was homeless in the war zone that is Syria, while everyone in Houston and Philadelphia has crossed the Syrian border in search of something better.

The Independent’s interview with Ahmed contains no information about his life before the war, but he probably belonged to Syria’s middle class. It must have cost money to get out of Syria, and even more to get from Turkey to Germany. Most of the people who have got furthest from the fighting are likely to be the people who had the resources to make the journey, while the majority of the displaced who have not managed to leave Syria are probably those who were the poorest before the war began.

Defensives and welcomers

The relatively small number who attempt the dangerous crossing into Europe are the subject of a debate that has become so polarised that sensible discussion is often vilified by both sides. The two camps can be divided into the defensives, who want to pull up the drawbridge and protect Europe from a flood of migrants and the welcomers, who want to help people who have suffered enough.

Refugees at a railway station in Vienna, September 2015 (Josh Zakary [CC / Flickr])

The defensives accuse the welcomers of disregarding the needs of native Europeans who will be threatened and impoverished by a ‘swarm’ of refugees, as UK Prime Minister David Cameron called them. The welcomers accuse the defensives of being devoid of compassion for people who have suffered both from the conflicts they are fleeing from and from the privations of their journey to Europe.

At first glance, the history of the Syrian conflict would seem to support the defensives. The poor and desperate refugees leaving Syria look very similar to the poor and desperate refugees who migrated to the Syrian cities in the decade before the war broke out, fomenting the conflict in the first place (more on that next week). European defensives fear they will take the conflict with them.

There has already been some spillover of the fighting into Lebanon, which hosts more than a million refugees in a country of less than six million people. However, Lebanon is not only a refuge for people fleeing the war but an operational base for some of the major factions of it. Hezbollah has an uneasy position as an armed political party in Lebanon’s uneasy democracy, and used Lebanon as a base for operations against Israel for decades until the last conflict in 2006. It is now an ally of the Syrian government forces against the Free Syrian Army and the Al-Nusra Front, which operate out of Lebanon. The clashes in Lebanon have been between combatants in the Syrian war rather than among refugees, so the situation is not likely to be repeated in European countries with no border with Syria.

Angel Gurrìa speaks for the OECD

Perhaps the strongest argument against the defensives was put forward by Angel Gurrìa, Secretary-General of the Organisation for Economic Co-operation and Development (OECD) on 22nd September this year:

European leaders cannot afford to be afraid. The refugee crisis is not one from which they can opt out. No magic wand will empower leaders to transport more than a million people back across the Aegean and the Bosphorus to

Whether we call them refugees, migrants or asylum seekers, they are in Europe and they are genuinely desperate.

Gurrìa went on to identify three challenges that Europe must meet. European governments must agree on a fair allocation of the refugees who have arrived, those refugees must be integrated into the countries they live in, and ‘the third, and greatest, challenge that European leaders have to overcome: the fear of migrants’.

At present, European leaders are failing spectacularly to meet the first challenge. New agreements are drafted, rejected and redrafted in a daily basis. Ahmed and his fellow refugees do not have the resources to survive until they make up their minds. They are making their own way across Europe as best they can. As I write this, most of them are somewhere on the northwestward trek from Turkey’s Aegean Sea coast to the favoured destination of Germany.

Are Syrians fleeing war or exporting it?

The biggest threat to the second challenge is the third: the defensive view that refugees are to be feared. It’s a fear that many Syrians now on the northwestward trek probably felt themselves a few years ago, when they saw the rural unemployed arriving in the slums around their suburbs. Such fears have been so tragically justified that it would be short sighted to dismiss the European defensives without examining their arguments.

European defensives fear the refugees on two levels. They fear that they will bring the conflict with them. They also fear that an influx of unemployed refugees will be a burden on the public purse unless they find work, when the influx of cheap labour will put native-born people out of work and drive down wages for those who can find a job.

Data from September 2015 (OECD)

Jack Goldstone, then Professor of Sociology and International Relations at University of California Davis and now at George Mason University, discussed the evidence that rapid population increases can cause instability in a 2002 paper. In evaluating how far his warnings apply to the current situation in Europe, we need to start by considering how large a population increase the European Union is facing. So far the influx amounts to around 400,000 Syrians and perhaps twice that number from other countries. The population of the European Union is over 500 million, so the EU is facing a population increase of far less than 1%.

Nor is the size of the migration unprecedented. As I write this, the year with the highest migration into the EU is 1992, at the height of the conflicts in the former Yugoslavia. 2015 will probably top the 1992 number before the end of the year, but that figure should be balanced against the fact that the EU is considerably larger now than it was then, having swelled from 13 states to 28.

The danger of the ghetto

Goldstone’s warning of population increases leading to instability is most likely to be realised if too many refugees become concentrated in one place. There will be far more workers than jobs in that region, so their choice will be between working for next to nothing or not working at all. With public services overwhelmed, police will concentrate
on protecting the locals from the refugees and any criminals among the refugees will be free to prey on the majority. The refugees will become poor and desperate, and will have reason to see the people around them and their police as their enemy.

Hence Gurrìa’s first challenge: a fair allocation of refugees throughout the European Union. If the refugees are dispersed, they will become integrated citizens rather than desperate outsiders. As Gurrìa puts it:

Our work at the OECD shows that migration, if well managed, can spur growth and innovation. Unfortunately, in the past, migration has not always been well managed: migrants have been concentrated in ghetto-like conditions, with few public services or employment prospects.

Are they coming for our jobs?

It is the second element of the defensives’ fear that stands in the way of fair allocation: the fear that the refugees will either need to be paid for from the public purse funded by citizen taxpayers, or they will cause a labour surplus and drive down wages while putting citizens out of work.

Carlos Vargas-Silva of the Centre on Migration, Policy and Society (COMPAS)

A briefing by Carlos Vargas-Silva, an economist at Oxford University’s Migration Observatory, discusses the difficulties in assessing the economic impact of migration. Is a migrant still a migrant when they’ve been resident long enough to become a citizen? If a migrant couple receive benefits for a child born in the country they migrated to, should those benefits be counted as going to the migrant parents or the child who is a citizen by birth? How should the net contribution of a working age migrant be calculated when they will pay taxes until retirement and then may require a pension or may return to their country of origin? How can the effect of migrants on wages and unemployment levels be isolated from the fluctuations every labour market is subject to?

Vargas-Silva’s key question was where the balance lies between how much migrants to the UK contributes to the public purse through tax and how much she will draw from it in the form of benefits or public services. The briefing quotes several government reports showing that migrants to the UK were net contributors to the public purse in most years, and even when the economy has fallen into deficit, migrants were less of a drain on the public purse than native Britons. The government reports were criticised by Migration Watch UK, who argued that migrants put more natives out of work and depress wages more than the government reports allowed for.

The government reports were in keeping with findings in a World Bank report that migration of labour from low income to high income countries actually stimulates the economies of the high income countries to the benefit of citizens:

Migrants crossing the border between Hungary and Austria, September 2015. A crisis or an opportuity? (Mstyslav Chernov [Wikimedia Commons])

A model-based simulation performed for this study indicates that a rise in migration from developing countries sufficient to raise the labor force of high-income countries by 3 percent could boost incomes of natives in high-income countries by 0.4 percent.

The problem with the World Bank model is that it’s based on data from many different countries, which have vastly differing patterns of labour and migration. An average income increase of 0.4% would predict many cases where the effect on income is negative.

Vargas-Silva discusses the very different situations of different migrants to the UK. A Syrian driven out of his own country by the conflict has little access to benefits, but has no home to return to if he cannot find a job. A Hungarian or Romanian can claim more benefits as they are EU citizens, but they’re likely to return home if they can’t find a job.

Germany bound

While most of EU countries have a lobby of welcomers, the most positive response to the northwestward trek has come from its favoured destination of Germany. Germany’s estimate of the number of refugees it expects to receive this year has risen from 300,000 in January to 450,000 in June to 800,000 in August. That’s about twice the number of Syrians currently estimated to be in Europe, or more than half the total number who have crossed the Mediterranean. Daunting as the numbers may look, 800,000 immigrants would only increase Germany’s population by around 1%.

The figure of 800,000 will not remain stable, even if it rises no further. If he can find work, he will probably bring his family to join him so admitting him will lead to the admission of several more people. On the other hand, it’s possible that Syria will stabilise over the next decade in which case Ahmed may decide to return.

From OECD’s Interntional Migration Outlook 2013, p160

OECD statistics published in 2013 (p.160) show a note of caution as Germany has a less favourable ratio of contribution to expense from its migrants than any other EU country. In spite of that, the welcomer argument still has more traction in Germany than in any other EU country. By contrast, the response of the British government, where migrants are net contributors, has been to act as though refugees at the other end of Europe are someone else’s problem.

However, Germany’s demographics provide a compelling reason to pay attention to the welcomers. Germany has the demographic bulge of an ageing population in which the birth rate has been below the replacement rate for some time. Over 20% of Germans are over the statutory retirement age of 65 (p.76). A further 14% are between 55 and 65, expecting to retire in the next decade. Germany is operating a generous welfare state paid for by one of the healthiest economies in the world, but it is facing an imminent shortage of workers to operate that economy. It’s no wonder the German government sees an influx of working age migrants as more of an opportunity than a problem.

Demographics in Germany: a country in need of migration (CIA Wold Factbook)

Simply looking at the demographics only tells part of the story, as Germany’s cultural openness is also a factor. Hungary has a similar demographic bulge and declining population to Germany, but the Hungarian response to the trek has been among the most hostile.

A diversity of migrants

Vargas-Silva highlights the difficulties of predicting the impact of migration:

Estimates must take account of migrants’ characteristics such as skill level, age distribution, family composition, health status, fertility patterns, and the temporary versus permanent nature of immigration.

The briefing prioritises skill level as the chief determinant of a migrant’s contribution, but no one is collecting the CVs of the northwestward trekkers. The countries they are passing through are overwhelmed with either providing services or fortifying their borders, or in many cases both.

Yet to debate whether the refugees coming in will benefit EU countries or drain their resources is to miss Gurrìa’s point. The refugees are already in the EU. The available options are to throw them back into the Mediterranean, a policy the most hardened defensives balk at, or to formulate policies that make the most of the situation.

Forging opportunity from crisis

The basis of a sensible policy must be to turn refugees into productive citizens. That means accepting the fact that in the short term, their needs will exceed their ability to contribute. Ahmed has been bombed, beaten and nearly drowned, and his experience is not unusual. Many will be physically or psychologically injured, and will need medical support to recover. Most will need to be provided with housing, clothing, food and language instruction before they can work productively.

Whether providing these services will be more or less expensive than the massive police operations mounted to block the trek, such as that under way in Hungary, is unclear. What is clear is that a policy of acceptance will be far more likely to turn them into a benefit for their host nations in the years to come than a policy of exclusion, which will lead to the impoverished ghettos that Gurrìa warns of.

Yet the fundamental argument deployed by the welcomers is not one of economic utilitarianism. It is that people struggling ashore from rubber boats deserve our compassion, and that compassion is a tenet of any society worth living in. As European leaders continue to play pass the problem in the manner they learned as children playing pass the parcel, we can only hope they remember that.